| NEW ORGILL PREZ KEEN ON REGIONAL EXPANSION |
 MEMPHIS — Anticipating his new role as president and CEO of Orgill, Ron Beal is nothing but optimistic about the direction of the company."Things are going extremely well for Orgill," he says. He's especially excited about the installation of Orgill's newest distribution center, which is being erected in Hurricane, Utah. With that move, he says, Orgill will truly be a coast-to-coast organization.
Beal, who is currently senior vice-president and general manager of Orgill's hardware division, will change titles at the beginning of the new year (see People on the move in this issue for full personnel details).
The new warehouse follows on the success of a DC that went into Tifton, W.Va., four years earlier. The success of that facility in expanding Orgill's reach into the Northeast gave the company the confidence to expand into the Rocky Mountain region of the Northwest with the Utah DC, which will be Orgill's fifth.
"We've done a lot of research before committing to the distribution center," says Beal. "We have some customers already in California, Nevada and Utah, but they are currently being serviced out of Memphis." He doesn't see that as a cost-effective strategy in the long term, hence the need for the new DC.
The expanded presence in the West will also add to Orgill's credibility as it recruits new dealers to be part of its independent wholesale distribution network. "We're confident that the business is there, and as we speak, we're putting together our sales force in place." The region is being serviced right now by a team of 18, which will be expanded as needed, he says. |
| LOWE'S NEW LOGISTICS CHIEF REFLECTS GROWTH AT DC LEVEL |
| MOORESVILLE, N.C. — Lowe's Cos., the second-largest home improvement retailer in the world, promoted its senior vp-distribution Mike Mabry to the post of executive vp-logistics and distribution. In that capacity, Mabry will oversee the retailer's burgeoning distribution network, as well as all logistics and replenishment functions for its 1,000-plus stores.Mabry joined Lowe's in 2003 after spending 12 years at Wal-Mart Stores, where he served most recently as vice-president of global services.
Lowe's expansion strategy mimics the Wal-Mart approach to distribution centers to control the even flow of products. Over the past several years, Lowe's has built distribution facilities as it reaches critical mass in its store count in a given region. In June, for example, the company opened a 200,000-sq.ft. flatbed DC on 56 acres in Beaumont, Calif., which is handling 70 flatbed semi-trucks a day initially, but has the capacity to handle 140 as Lowe's expands in California's Inland Empire region in the south.
Lowe's operates 11 flatbed DCs and plans to open one or two more this year. It also operates nine massive regional DCs — some larger than one million sq.ft. — and is scheduled to open its 10th in Poinciana, Fla., in the third quarter of this year, and its 11th in Plainfield, Conn., next year. |
| HOME HARDWARE JOINS SEARCH FOR URBAN SITES |
| ST. JACOBS, Ont. — With all that talk about big boxes looking for urban sites (Home Depot opened in Manhattan last week and will open in Vancouver this coming week), what about another member of Canada's "Big Four" home improvement retailers, namely Home Hardware Stores Ltd.?Home would like more city sites, too, despite its focus on smaller centres, one that includes a strong presence in rural Canada. In the cities, however, Home's presence is variable. Toronto, has a strong contingent, with 24 dealers in the city proper, while Vancouver has nine. However, Calgary has only one, and Halifax has none.
Paul Straus, vice-president and CEO of Home Hardware Stores, says the group's potential for growth is with the expansion efforts of its own members, either through larger, renovated premises or the addition of stores. "It's one of the areas we still see for greatest growth is with our existing dealers. We really want to help our existing dealers grow."
And, he says, there's an opportunity in the cities. "We've got potential in the cities and we'd like to grow in the cities, as well as our rural markets." However, in those urban markets, available real estate is often tough to come by, so Home Hardware must wait for another business to vacate a building.
Home is not alone among Canada's Big Four retailers, which collectively comprise almost half of retail sales in this industry. Home Depot will open its first "urban neighborhood" store in Vancouver on Thursday, an upscale, décor-oriented number on two floors in the Park Royal power center. Rona continues to target major cities, including Calgary and Toronto, for big box locations. Even Canadian Tire has gotten excited about the success its experiencing with a large "metropolitan" store in Kingston, Ont. In every case, these big box stores target the upscale, wealthy, often childless urban consumer. |
| RONA DEALER PROVES VIABILITY OF THE INDEPENDENT |
TORONTO — The latest innovations in the industry didn't come just from the international executive level at the recent Hardlines Conference Series. Roy Perkins is co-owner of Perkins-Caron Home Centre in Cornwall, Ont. With a customer mix that is largely francophone, Perkins has built a successful operation with a common-sense mixture of hard work, strong focus on service and a fearless devotion to continual innovation. He also believes strongly in setting goals — "a secure business plan and financial plan with targets for everything — sales, GMROI, basket size — everything."
Like many Rona dealers, Perkins enjoyed a windfall when the company went public in November 2003. The value of his shares soared, giving him the financial resources to invest in expanding the business. Today, it includes a Kitchen & Bath Showcase, along with the traditional Home Centre.
Thanks to strong emphasis on customer service, aggressive advertising and marketing within the community, Perkins' business is flourishing — despite the presence of big box stores in both Ottawa and Kingston, Ont. And he is confident the business will weather the arrival of a new Home Depot, slated to open right in his own town in the near future. |
| 84 LUMBER FOUNDER GETS CREATIVE ATTRACTING GOLFERS |
| PITTSBURGH — Tiger Woods, who has struggled mightily to regain the stroke that made him professional golf's leading player, has backed out of the 84 Lumber Classic at the Nemacolin Woodlands resort in western Pennsylvania, only one week after tournament officials had announced with great fanfare that they had secured the participation of both Woods and golf's current number one-ranked player, Vijay Singh.PGA.com reported that more than 80,000 tickets have been sold for this tournament so far, which was counting on its marquee line-up to draw huge crowds. Not only that, but Joe Hardy, who owns 84 Lumber and Nemacolin Woodlands, ordered millions of dollars spent to lengthen his course by 400 yards to 7,500 yards and rebuild all 18 greens, after players and reporters had criticized the course for being too easy to play. The 18th hole of the course was redesigned to make it tougher to play.
Sixty of the top 100 PGA Tour money winners have signed on to play the event, which would be a considerable improvement over its inaugural year, when it drew only one of the sport's top 21 earners, according to the web site. To further increase interest among the pros, Hardy launched an aggressive campaign to woo them, with gifts, free travel and richer prize money. Any golfer who commits to the event will be flown free of charge, along with four others, to the World Golf Championship event in Ireland. A golfer can bring his wife, caddie, agent, child or all the above, all for free. The deal is valued at $40,000 per golfer. Hardy also offered participants luxury housing in a new resort hotel, Falling Rock, where rooms normally go for $350 to $800 per night. |
| STEADY SALES GROWTH PROJECTED FOR L&G CONSUMABLES |
| CLEVELAND — Demand in the United States for packaged lawn and garden products, such as fertilizers, pesticides, growing media, seeds, and mulch, is expected to expand by 4.5% per year to $7.5 billion in 2008, according to a study conducted by the Freedonia Group, a market research firm based here that uses manufacturers' shipment data to project buying trends in home improvement products.The residential market will account for more than three-quarters of total demand in 2008. Home gardening and lawn care activity has been increasing steadily over the past decade as aging baby boomers have more time for leisure and outdoor living. The Freedonia Group also pointed to strong marketing campaigns, the increased availability of products at home centers and mass retailers, and improved products as reasons why sales of these products are expected to expand.
Demand for organic consumables will grow nearly twice as fast as conventional product sales, but organics will remain a small percentage of the entire market. While growth in bio-pesticides will decelerate, demand for organic fertilizers, which comprised 20% of the organic market in 2003, will grow nearly 15% per year.
Sales of conventional pesticides, which make up more than 30% of the market, are expected to be sluggish. |
| U.S. MARKET INDICATORS |
| Market observers who have been waiting for the new housing bubble to burst had to curb their scepticism a little longer after the Commerce Department reported last week that homebuilding activity in August was at its strongest since the spring.For the month, housing starts were percolating along at a seasonally-adjusted annual rate of 2 million units, which was 0.6% higher than adjusted figures in July and 9% higher than the rate in August 2003. Single-family starts were being started at an annual rate of 1,667,000 units, which was 0.4% about the July mark.
One cause for concern, though, was the 5.5% decline in permits in August, compared to July, to an annualized rate of 1,952,000 units. That permit number was even slightly below the August 2003 figure. Whether that indicates that homebuilders are finally about to pause a bit to catch their breath, or are simply building at a rate that will sustain demand, remains to be seen. |
|
| COMPANIES IN THE NEWS |
| WINTER HAVEN, Fla. — Scotty's Inc., the home improvement chain that once dominated Florida home improvement retailing, has filed for bankruptcy protection, yet another victim of damage from Hurricane Charley. Scotty's largest store, in Punta Gorda, was completely destroyed by the tropical storm. Several other stores were seriously damaged, as well. A prepared statement from the company said, "The damages from Hurricane Charley were simply more than the company could sustain. However, the company expects to emerge from Chapter 11 "and return to profitability within a reasonable period of time."MONTREAL — Over the past two weeks, Sodisco-Howden Group has met with its vendor base to outline the wholesale distributor's marketing plan and strategies for 2005. Those meetings involved 100 vendors in Toronto and 220 in Montreal. Sodisco-Howden went through a "quiet period" earlier in the year, which hindered the company's ability to clarify and communicate its direction. But now, communication to both vendors and customers is getting renewed emphasis. The new program will include more promotion of the Ace and Pro banners, which are licensed by Sodisco-Howden, revamped websites, a national television ad campaign, and an improved electronic catalogue.
SPECIAL REPORT — Wal-Mart has admitted that it has sent a team of analysts to Russia to check out possible expansion there, says Reuters. The likely location for a first opening would be in St. Petersburg. However, Wal-Mart refused to comment on their Russian foray. If and when it enters Russia, it will be in good company. Ikea has targeted that country for growth, and German-based home improvement retailer OBI has opened its first store there.
VANCOUVER — Rona's North Vancouver store has been re-opened as a Rona Home Centre event after undergoing a two million dollar facelift. Under the supervision of manager Al Shamley, the North Vancouver RONA was entirely redesigned from top to bottom. It features the "boutique concept", which is unique to RONA among the home renovation industry. The North Vancouver store includes brand new paint and décor, lighting and kitchen boutiques. Located at 1160 East 3rd in North Vancouver, the newly renovated 39.850 sq.ft. stores is part of Rona's efforts to invest in its Western operations. The store in Vancouver's Granville neighborhood got a similar facelift recently.
ATLANTA & VANCOUVER — Home Depot is going to donate more than 250,000 volunteer hours through community service projects next week, in a series of volunteer community improvement projects throughout the United States, Canada, Mexico and China. All this week, volunteer staff from Home Depot will work with national non-profit partners Hands On Network and KaBOOM! on everything from building playgrounds and creating walking trails to painting school murals and landscaping in public parks. In addition, the company has announced the donation of $3 million in grants, tools and supplies to help hurricane victims in Florida.
ATLANTA — Home Depot has unveiled a program to recruit military veterans at its stores. Joining forces with the U.S. Departments of Defence, Labor and Veterans Affairs, the giant retailer will provide career opportunities for veterans interested in a new career. The program includes separating active duty service members, national guard members, reservists and military spouses. The U.S. Department of Labor will make Operation Career Front information available through its 2,000-plus One-Stop Career Centers throughout the country.
LITTLE ROCK, Ark. — Wal-Mart is getting sued, this time for discrimination against blacks. The suit was filed by Daryal T. Nelson of Coldwater, Miss., in U.S. District Court here. It alleges that Wal-Mart rejects and discourages black applicants for truck-driving jobs at the chain's distribution centers in 12 Southern states: Arkansas, Alabama, Florida, Georgia, Kentucky, Louisiana, Mississippi, North Carolina, South Carolina, Tennessee, Texas, and Virginia. Nelson wants to turn this into a class-action suit. |
| CORRECTION |
| Contrary to what we ran last week, Jeff Porter does not work for Leviton. He is managing director, Canada for Intermatic Inc. My apologies for the mix-up — and my thanks to all the faithful Hardlines readers who mentioned it to Jeff at last week's Home Hardware Spring Market. Thanks to you, he called me right away to sort out the confusion, and joined the Hardlines family in the process! — Michael |
| PEOPLE ON THE MOVE |
| Orgill Inc. has announced a reorganization of its executive team, effective January 1, 2005. Joseph Orgill III is stepping down as chairman of the board ... He will be replaced by Bill Fondren, who is currently president and CEO ... Fondren's position will be assumed by Ron Beal, who moves up from his duties as senior vice-president and general manager of Orgill's hardware division ... Byrne Whitehead, currently in charge of finance and administration, will take over as senior vice-president and general manager of operations, finance and administration.Bruce Allen has joined Calgary based Vipco as president. He joins the company, which manufacture walls, ceiling panels , and molding for industrial retail customers, from Guardian Building Products.
Steve Stephens has been appointed director of marketing for The Toro Co., Irrigation Division. In his new role, Stephens will develop and implement the strategic marketing plans for all irrigation division product lines, including Toro residential/commercial and golf products, and Irritrol Systems brand products. Prior to joining Toro, Stephens was vice-president, operational marketing, for Centex Homes. He also held a number of marketing positions with Black & Decker.
At Western Forest Products Inc., Reynold Hert has been appointed president and CEO. He assumes his new duties with WFP at the company's Duncan, B.C., office effective October 4, 2004. Hert joins WFP from Weyerhaeuser Canada, where he has spent 26 years in various roles, most recently as vice-president, Canadian Forestlands. Western Forest Products is an integrated Canadian forest products company and the second largest coastal woodland operator in British Columbia. |
| CANADIAN MARKET INDICATORS |
| Retail sales advanced for a third consecutive month in July, up 0.5% to a record $28.9 billion. This followed increases of 0.3% in June and 0.6% in May. In fact, July's increase was the sixth monthly sales gain so far this year, following a period of successive declines in the last four months of 2003. Previously, retail sales had generally been rising since the fall of 2001. Overall, retail sales growth in June and July remained unaffected by price changes. |
| OVERHEARD... |
| "We don't run a business, we manage a business." — Roy Perkins, co-owner of Perkins-Caron Rona Home Centre in Cornwall, Ont. He offered his insightful home truths about the challenges of the independent retailer at our recent Hardlines Conference Series. |
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****HARDLINES MARKETPLACE****
Don't miss the products and services on the Hardlines web Marketplace:
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And check out Hardlines Classifieds on the web:
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HELP WANTED
NATIONAL SALES & MARKETING MANAGER
Company: Division of a Fortune 500 Manufacturer in the industrial construction products sector.
Position: Reporting to the head of the Industrial Division, the incumbent will be responsible for selling to wholesale distributors and OEM channels, leading a team of 8-10 sales professionals and developing trade focused sales and marketing strategies. 50% travel is required to cover the national scope of the position.
Experience & Background: The successful candidate will have a university degree (or three year College Diploma) and a solid track record with an industrial manufacturer selling to wholesale distributors. Must have previous sales management experience.
Send resumes to buzz@hardlines.ca - note P.O. Box #640 in Subject Line.
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ONTARIO SALES MANAGER
Leading Canadian building product manufacturer is seeking a proven sales manager for the Ontario market. Candidate must have a minimum of three years sales management experience. Competitive salary, company vehicle, benefits and the opportunity for advancement. Please forward resumes, including expected remuneration, to buzz@hardlines.ca P. O. Box 963.
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BUYER AND ADVERTISING COORDINATOR
Tim-BR Marts Ltd. is currently looking for a buyer and advertising coordinator.
Qualifications:
- A minimum of 5 years purchasing experience in the home improvement industry; advertising experience in this industry would be an asset.
- Able to work under pressure, meet deadlines and be a team player.
- Ability to work with our suppliers and our network of independently owned dealer locations.
- Flexibility to do what it takes to get the job done.
- Career oriented.
Please forward your resume to:
Tim-BR Marts Ltd.
705 1601 Airport Road N.E.
Calgary, AB T2E 6Z8
E-mail: robyn@tim-br-mart.com
Attention: Robyn Cull
We thank all applicants for their interest in this position, however, only those considered will be contacted for an interview. PLEASE NO PHONE CALLS
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PURCHASER - LUMBER & COMMODITIES DEPT.
Toronto based national buying group is planning to expand the role and function of its lumber and commodities department. The successful candidate will be responsible for negotiating and establishing annual purchasing agreements, provide weekly commodity market updates, initiate pool buys, direct mill purchases, and provide individual support and consultation for member companies.
Knowledge of product and product application, channels of distribution, alternative and related bldg. materials and marketing trends in the LBM industry is essential. Candidate will also posses a sound working knowledge of Microsoft excel, and Microsoft word. A minimum of 10 years experience in retail, distribution or manufacturing is required.
We offer a competitive remuneration and benefit package
Please reply in confidence to buzz@hardlines.ca; put P.O. 723 in the subject line.
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REGIONAL SALES MANAGER — ONTARIO
We are a major building materials company seeking a proven sales executive for the Ontario region.
Based in GTA the position entails a variety of responsibilities that would include but may not be limited to:
- Sales/Territory Management
- Business development
- Major Account Management
Candidates are required to have pertinent industry experience in sales and/or marketing management. A university degree would be an important asset but equivalent experience will be considered. Our company offers a very competitive salary and benefits package appropriate to the position.
Please forward your resume with covering letter to buzz@hardlines.ca and put P.O. Box 815 in the subject line.
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SERVICES OFFERED
 BLACK EAGLE CONSULTING 2000 INC.
President Richard Simms has 35 years experience in the hardware/housewares industry – both as a manufacturer and a consultant. Black Eagle Consulting specializes in strategic plan analysis, organizational structure review, executive coaching/assessment, career counselling, succession planning. CHHMA affiliate member and Canadian Association Family Enterprise trained facilitator. See website www.blackeagle.ca or call 905-842-3010/email rsimms@blackeagle.ca for more information.
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Contact Dave Leslie at 905-702-9443, to find out how Noral can boost your sales in Canada. http://www.noralmarketing.com
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TO PLACE YOUR AD, CALL PHYLLIS NOWELL AT 416-489-3396 OR EMAIL: phyllis@hardlines.ca |
John Caulfield, Contributing Editor
vol. x, #39, September 27, 2004
